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An “equitable” division aims for fairness, not equality in the division. You and your spouse have critical parts to play to avoid an all-out war. Opt instead to think about the division as a kind of trade and exchange arrangement where you both will get what you want some of the time, but knowing that you aren’t likely to get everything that you think is “fair”.

Equitable division in divorce is about agreeing to trade, not winner take all.

Achieving an equitable distribution has much more to do with your attitudes and having a trade-type negotiation strategy than it does with the law –until, of course, you find yourselves in court facing a judge who is deciding for you.

NJ Property Classifications in Divorce

The first step in equitable distribution is to classify property. All property falls into two categories: the first classification defines whether the property is marital or separate. The second characteristic distinguishes the property as either tangible or intangible.

Divorce Property is Classified as Marital or Separate

As implied by the category names, separate property identifies the property that clearly belongs to one spouse. For example, property acquired before the marriage or inherited before or during the marriage would be identified under different categories. Marital property includes property acquired during the marriage. It sounds straightforward, but actually determining which is which is not always black and white. It is pretty easy to decide which car is whose or who owns the ski equipment; but it can be very difficult sometimes for spouses to decide who owns the pet, the country club membership or the credit card bill.

Divorce Assets are Classified as Tangible or Intangible

Tangible refers to physical property. That’s easy: the house, the cash, the boat. It is anything that can be physically touched. Intangible, of course, is the opposite and refers to things like patents, trademarks & logos, trade secrets, copyrights, debts, future income or rents, business contracts, brand recognition and company good will.

Valuation of All Divorce Property

The next step is to determine the value of the property. For most assets or debts, the value will be the fair market value as of the date of separation. For some items, the fair market value will be easy to determine, while others will be more complicated.


A bank account is the easiest item to value; simply find the account balance as of the date of separation. The marital residence is usually easy to value too by getting an appraisal or agreeing to use the tax value of the property. On the other hand, the value of your frequent flier miles, timeshare, or a qualified pension plan can be tricky. One of the more difficult assets to value is a business interest.

Valuation, Division and Distribution of Business Property’s Assets and Liabilities

While a business owned by one spouse before the marriage might be considered to be his/her separate property during the marriage, a portion of the business can also be deemed marital property. If, during the marriage, the business increased in value, both spouses worked at it, or family money was used to finance the business, then some part of the business belongs to both spouses. Frequently, whenever an individual's property is commingled with marital assets, some percent of it becomes marital property.


When the business interest has, or is expected to have, a high monetary value, both spouses will likely hire independent experts. If spouses can’t agree and the divorce settlement goes to court, there could be a “battle of the experts”. Both experts will testify respectively as to the value or worth of the business. In court, it will be up to the judge to decide which expert he/she finds more credible. The expert attorneys at Townsend, Tomaio & Newmark can help make sure that your settlement agreement minimizes tax consequences, avoids penalties and protects your business assets.

There’s a Lot More to NJ Equitable Distribution than Splitting Everything 50-50

Equitable division is mostly about attitudes and negotiation skills; it’s about trades and exchanges. An experience divorce settlement lawyer may be able to  guide you through the process of dividing and negotiating during divorce.


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Disclaimer: This website and information presented are for the purposes of legal marketing and general education. No part of this site should be construed as legal advice. Please consult with an attorney regarding your specific situation. © 2018 Townsend, Tomaio & Newmark, L.L.C.